Traders are betting record amounts of money on China’s metals markets, expecting a continued rally in the prices of base metals and lithium.
At the end of 2025 and the start of 2026, speculators held record-high open interest in the base metals copper, zinc, nickel, tin, lead, and aluminum traded on the Shanghai Futures Exchange, and near-record open interest in battery metal lithium on the Guangzhou Futures Exchange.
Concerns about tightening global metal supply, lower interest rates driving investment in metal commodities, and expectations of resilient industrial and electrification demand despite the U.S. trade policies have combined to drive record bets on the metals markets in China.
Record open interest in the six base metals on the Shanghai Futures Exchange pushed trading values soaring by over 260% from the previous year, according to data from the exchange compiled by Bloomberg.
In December alone, the turnover of the trades in the base metals plus gold and silver hit 37.1 trillion Chinese yuan, or a massive $5.3 trillion.
Copper trading volume soared on December 29 to the highest volumes in Shanghai in over a decade, per the data crunched by Bloomberg.
Meanwhile, copper prices on the London Stock Exchange were on a string of breaking all-time high records.
On the Guangzhou Futures Exchange, open interest and trading volume in lithium both hit an all-time high in November 2025, before sliding in December as the exchange raised fees and capped the number of new positions. Even with the drop in December, open interest and trading volumes at Guangzhou remain at historically high levels, as speculators bet on the key battery and energy transition metal.
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Amid bullish global outlooks for metals, trading volumes and open interest on the Chinese markets are set to remain elevated this year, analysts say.
“Most base metals are likely to remain well supported next year,” ING commodities strategists Warren Patterson and Ewa Manthey wrote in a note in early December, when copper prices were headed to record highs.
Uncertainty about U.S. tariffs, tighter markets amid supply disruptions, and a weaker U.S. dollar are all poised to boost metals markets this year, according to ING.
“Uncertainty over US refined copper tariffs will likely continue to see strong refined copper flows to the US, tightening up the ex-US market,” the ING strategists said.
Global aluminum markets will also be tight this year, as China approaches its production cap while other producers consider closures due to high power prices, ING reckons.
As 2026 began, nickel prices jumped by 10% in a single day in London this week as buying surged in China. Despite the heavily oversupplied nickel market, concerns about supply disruptions in Indonesia, the world’s biggest producer, tilted sentiment to the bullish side. Moreover, the record trading volumes on the Chinese market also supported nickel prices in the first week of the year.
Copper has been the star base metal over the past year, rallying to record highs as supply disruptions and U.S. trade policies have created concerns about shortages.
Copper prices hit a record $12,000 per ton on the London Metal Exchange at the end of December, and notched in 2025 their biggest annual gain since 2009.
The copper rally continued into 2026, with prices topping $13,000 per ton this week. Copper prices have now jumped by 16% since the beginning of December alone.
In recent months, copper prices have rallied amid threats from the Trump Administration to impose tariffs on the industrial metal crucial for electrification and grid expansion. Traders are amassing copper in the United States. The hoarding has hiked copper prices at the Comex exchange in New York and shrunk supply elsewhere in the world.
Moreover, “Copper’s linkage to AI-related data centre demand and electrification themes is drawing in new capital, with many market participants pointing to increased activity from funds, rather than physical market interest, as key price drivers,” analysts at Benchmark Minerals said this week.
By Tsvetana Paraskova for Oilprice.com
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